Three Trends Driving Up the Cost of Workers Compensation Claims
In 2023 , the construction sector reported three times the number of workers ’ compensation claims compared with any other industry . Thirty-nine percent of serious injury claims were filed by construction workers . For comparison , only 11 % were filed within the mining sector .
Construction has always been a riskfilled industry . But what ’ s driving workers ’ compensation claims today ? Ken Bunn , Vice President of Claims at Builders Mutual , discusses three of the top trends impacting workers ’ comp and what contractors and insurers are doing about it .
TREND # 1 : INCREASING MEDICAL UTILIZATION
Workers ’ comp losses depend on two main factors : frequency – or number – of claims , and severity , a measure of how much each claim costs . While the frequency of claims has been flat to declining in recent years , severity has charged upward .
For example , larges losses – defined as claims over $ 250,000 at Builders Mutual – historically had been around 33 % of the total spent on claims . Now , that figure stands at around 45 %. Another insurer has seen a 30 % increase over the last three years of claims worth over $ 10 million .
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